Qatar Invests Big in World Cup, Economic Makeover

Qatar is expecting to spend more than $65 billion preparing to host the 2022 World Cup. That investment, however, is aimed more at remaking the country's economy and international position than hosting the tournament.

Qatar will build nine stadiums and refurbish three more and plans to equip each with solar-powered air conditioning to fight temperatures that approach 50 degrees Celsius (122 Fahrenheit) in the summer. The sheikdom promised FIFA, world soccer’s governing body, to more than double hotel and apartment rooms to 84,000 and build a $25 billion rail and metro network. South Africa said it spent about $11.4 billion preparing for the 2010 World Cup, or about $232 per person.

“The event is a catalyst for the development and the expansion of the economy and population overall,” said Mark Proudly, associate director at property adviser DTZ Research in Doha.

Qatar Places $65 Billion Bet on Remaking Economy in World Cup Preparation
Bloomberg
December 16, 2010

South Africa Sees Small Return on World Cup Expenditures

The South African government is reporting a $500 million return on the $4.6 billion it spent to host the 2010 World Cup.

Marthinus van Schalkwyk, South Africa's tourism minister, said just 309,000 foreign fans attended the tournament, compared to predictions of 450,000.

South African-based companies also failed to reap the benefits of the tournament, according to a study by KPMG. Just 22pc of KPMG's 100 biggest African clients, including several multinationals, said they had benefited from the World Cup, compared to 45pc predicting a boost last year.

South Africa recoups just a tenth of the £3bn cost of staging World Cup 2010
The Telegraph
December 10, 2010

$100 Billion In Infrastructure for Qatar

Economists are predicting more than $100 billion (USD) worth of investment in infrastructure ahead of the 2022 World Cup in Qatar. Much of that investment is expected to be through public-private partnerships.

A compelling statistic the report reveals is the present value of major infrastructure projects currently under construction in Qatar which amounts to over US$55Bn, around half of the estimated US$100bn to be awarded in the near future.

"The build-up to the World Cup will give additional momentum as well as push ahead the time frame of these projects," added James.

...More than $75bn has been invested in this sector since 2004.

''World Cup Will Spur'' Qatar's $100bn Infrastructure Projects Market
The Peninsula
December 5, 2010

Critic: Long-Term Impact Unlikely from Russia's 2018 Investment

Critics argue that the $10 billion investment Russia plans for its infrastructure ahead of the 2018 World Cup won't be enough to make a long-lasting impact on its cities.

Yulia Tsyplyayeva, chief economist at Moscow's office of BNP Paribas, said Friday that Russia badly needs structural reforms but the World Cup is unlikely to give an impetus to them.

Russian cities to get hollow World Cup facelift
Forbes
December 3, 2010

Brazilian Officials See Opportunities in World Cup Preparations

Officials in Brazil are hoping to cash in on their investments for the 2014 World Cup, and to create a broad legacy from the event.

The city of Rio and the federal government's national economic growth acceleration plan (PAC) envisages investment of 4bn Brazilian reais ($2.33bn; £1.46) for the city.

The investment will be concentrated in three areas: logistics (including roads, railways, ports, waterways, and airports), energy (including generation and transmission of electric power, petroleum, natural gas and renewable energy) and various other social and urban projects.

Brazil looks to score sporting and economic legacy
BBC
November 22, 2010

No Return Possible on Brazil's Stadium Investments

Economists are saying it will be impossible to generate a return on Brazil's $2.8 billion investment in stadia for the 2014 World Cup.

Brazilian states are awarding contracts that may be worth as much as $18 million a year to groups that run Amsterdam Arena and Lisbon’s Estadio da Luz to oversee facilities planned for the 2014 tournament. New York-based IMG Worldwide Inc. is looking at sites, chief executive officer Ted Forstmann said in an interview.

Arenas are being constructed in the financial hub of Sao Paulo through to poorer areas such as the Amazon state capital, Manaus. A financial return on the new buildings is “impossible” because most soccer stadiums are used too infrequently, according to Paul Fletcher, a former commercial director of London’s Wembley Stadium.

Brazil Seeks `Impossible' Return on $2.8 Billion World Cup Site Spending
Bloomberg
November 22, 2010

London Olympics Costing Less Than Expected

Olympics officials in London are projecting lower costs for hosting the event. Recent estimates put the total cost of hosting the event $46.9 million lower than previously expected.

The report estimates the final cost of the Olympics and Paralympics at $11.6 billion, after $32.3 million was cut from the budget of the main stadium. That includes a savings of $11.3 million by scrapping a planned fabric wrap around the venue.

Olympic Delivery Authority chief executive David Higgins said organizers have saved a total of $1.2 billion since construction began.

Cost of London Olympics trimmed $46.9 million
USA Today
November 9, 2010

South Africa's Lessons for Brazil in Overinvestment and Poor ROI

The economic impact of the World Cup has been mainly a loss for South Africa, according to this piece in the Financial Times -- a reality that the author says Brazil needs to face sooner rather than later.

South Africa had been saying the tournament would increase tourism, create jobs, build useful infrastructure, etc. But she realised: “It wasn’t going to be giving us the benefits that we had told the country the World Cup was going to give us.” True, Johannesburg’s creaky transport links would improve a bit, but “it wasn’t as much as we had thought”. And so, over a year before kickoff, Gauteng quietly binned hopes of economic bonanza. Somehow the officials forgot to tell the South African people, but then running a province keeps you busy. In the event, predictably, the tournament went well over budget, and attracted few big-spending visitors. I recently got an e-mail from an official at one South African university, which had reserved 92,000 “bed-nights” for football visitors. Shortly before the tournament began, he says, Fifa’s booking agency returned 91,000 nights unused. “We are still trying to sell off the additional linen we had to purchase,” the official complains. If sports economists are right, the Cup won’t boost future tourism and foreign investment in South Africa either.

South Africa’s football lesson
Financial Times
October 30, 2010

Sochi's $6 Billion Olympics

The 2014 Winter Olympics in Sochi, Russia are expected to cost more than $6 billion, according to Deputy Prime Minister Dmitry Kozak. Of that, roughly $2.9 billion will be provided by the government.

Re-settlement of town residents whose houses are to be demolished and lands withdrawn during construction works will cost an extra 12 billion rubles (395.6 million dollars).

He added this was only a preliminary estimation at the moment, as "a great number" of problems remains in place, including customs and border control issues.

Sochi Olympics may cost 6 bln U.S. dollars: official
Xinhua
July 23, 2010

$12 Billion Boost

The South African government has announced that hosting the World Cup has boosted the country's economy by about 93 billion Rand (~$12 billion USD).

The South African government pumped R30 billion into transport and telecommunications infrastructure and 10 stadiums, which created 66 000 new construction jobs and saw R7.4bn paid over in wages, with R2.2bn going to low-income households.

Upgrading trains and roads took care of R13bn, while R20bn was spent on airports development and R3.5bn on renovations at ports of entry. Another R1.5bn was spent on broadcast technology and R1.3bn on safety and security, including the deployment of 40 000 extra police.

Maseko rejected predictions that World Cup stadiums would become white elephants in the wake of the tournament. "During the bidding process all host cities were made to submit plans about how the stadiums would be used after the tournament," he said.

World Cup's R93bn boost for SA
Pretoria News
July 15, 2010

Nelspruit Worries About Future of its World Cup Stadium

Concerns are growing in Nelspruit that the $183 million stadium the province built for the 2010 World Cup (of which it hosted 4 matches) will be able to find a permanent user or sustainable business model.

“No team has yet been approached to make the stadium its home base, and this matter will be dealt with when the business model is finalised,” said interim manager for the stadium, Roelf Kotze, on Monday.

...Kotze said the pitch is suitable for soccer and rugby matches and has the same dimensions as the pitch at the Orlando Stadium in Soweto, where the Super 14 Final Rugby Match was played recently. Kotze said organisers of other events had, however, shown interest in using the stadium.

Mbombela white elephant?
Sport 24
July 12, 2010

Student Organization Calls World Cup a Waste

The South African Students Congress (SASCO) is calling the 2010 World Cup a waste of money.

"Instead of wasting money on stadiums and other related luxurious infrastructure, we could have used the same money, energy, zeal and enthusiasm to provide water, electricity, houses and free education for millions of poor South Africans,' said Sasco president Mbulelo Mandlana in a statement.

Mandlana said apart from the pride and joy Sasco felt because the country hosted the event successfully, it was "ashamed that we spent billions of public funds on stadiums that will immediately turn into white elephants after the World Cup and whose maintenance will be costly for years to come".

Cup a waste of money: Sasco
Sport 24
July 14, 2010

Justifying the Costs of Stadium Construction

This blog post from The Christian Science Monitor looks at stadium construction across the world and how officials are justifying their major capital costs.

In South Africa, the circus has left town. Actually, it’s been nearly three weeks since a game was played in Nelspruit or Polokwane, nothern cities where there is “no rugby or soccer team within hundreds of km.” The next game may be a long way off. That there may not earn enough future revenue to pay for maintenance doesn’t seem to worry those in the spotlight. Says archbishop Tutu: “With all the negative things that are taking place in Africa, this is a superb moment for us. If we are going to have white elephants, so be it.”

Update: global stadium construction
The Christian Science Monitor
July 13, 2010

Brazil Invests in Transit Ahead of 2014 World Cup

As Brazil prepares to host the next World Cup in 2014, its government is planning to invest heavily in urban mobility systems in its 12 host cities.

Twelve Brazilian cities have been selected to host World Cup matches. These cities now face a daunting but exciting challenge: to seize this opportunity to boost urban transit systems in a meaningful and lasting way. World Cup transit investments — meant to help Brazilian cities manage the estimated 2.98 billion additional visitors that the Cup will generate — have the potential to improve quality of life, safety and accessibility in Brazilian cities long after the Cup is over.

The federal government has set aside R$7.68 billion (US$4.34 billion) for “urban mobility” infrastructure improvements in host cities; state and local governments have committed an additional R$3.8 billion (about US$2.15 billion), bringing the total to R$11.48 billion (US$6.48 billion). Private investments will increase this figure. Ideally, transit projects should be nearly complete by the Confederations Cup, which will Brazil will host in 2013 as a prelude to the World Cup.

Spotlight on the World Cup: Brazil Gears Up for Games with Urban Transit Investments
The City Fix
July 9, 2010

South Africans: Was World Cup Worth it?

With the 2010 World Cup now over, locals are asking the inevitable question: was the World Cup worth the effort and investment?

The government certainly seems to believe so, which a cynic might point out is hardly surprising given that many of the governing elite and their friends and families treated the World Cup as an opportunity to party for a month at the taxpayer's expense. But this is not a time for cynicism, especially since there are clear indications that the goodwill South Africans of all colours and classes exhibited towards each other during the honeymoon period after 1994 has made a welcome comeback as a direct result of the World Cup.

South Africa: Was the World Cup Worthwhile?
Business Day
July 12, 2010

Zuma: $4.3 Billion Was Worth It

South African President Jacob Zuma says the 33 billion Rand (~$4.3 billion USD) spent by the national treasury to host the World Cup was a worthy investment. He specifically cited long-term improvements to communications and transportation infrastructure, as well as social improvements.

But the social impact had been even greater, he said, as black and white fans packed into stadiums and fan parks together, 16 years after the first all-race elections ended white-minority rule.

"The social benefits are priceless. We have seen remarkable unity, patriotism and solidarity being displayed by South Africans, which has never been witnessed before," Zuma told an investment meeting.

Zuma hails World Cup benefits
Sport 24
July 7, 2010

Russia Proposes $340 Million Investment in Stadia for 2018/2022 Cup

Russia is expecting to invest about $340 million on new stadia if it wins the right to host either the 2018 or 2022 World Cups.

"Sufficient funds have been allocated by the government for the reconstruction of existing bases, pitches, and infrastructure," [Russian Football Union head Sergei Fursenko] said. "Around 340 million until 2015 is expected to be spent on these needs."

He added that 13 new stadiums would be built for the tournament, and that even if Russia was unsuccessful in its bid, "we will build six stadiums in any case."

Russia to invest $340 million in football infrastructure
Rian
May 18, 2010

Brazil Eyes $20 Billion Investment in 2014 World Cup

Brazilian Sports Minister Orlando Silva has said the country will need to invest moe than $20 billion in stadia, transportation and infrastructure as it prepares to host the 2014 World Cup.

Silva said Wednesday that 53 transportation projects were in the planning stage and some had already been contracted.

Brazil: We must spend $20 billion on World Cup
Associated Press
May 20, 2010

Australia Announces Big Infrastructure Investments for Prospective World Cup Bids

With three new stadia and nine renovations planned, Australia is planning to spend nearly $2.5 billion on infrastructure projects if it is chosen to host the 2018 or 2022 World Cup.

Three new stadiums would be built in Perth, Canberra and Blacktown in Sydney's western suburbs, while nine venues in other cities would be upgraded, the FFA said in a statement.

"The infrastructure investment will leave a legacy to all sporting codes in the nation before and after the FIFA World Cup for generations to come," FFA Chairman Frank Lowy said.

Australia World Cup infrastructure to cost $2.48 billion
Reuters via Sports Illustrated
May 16, 2010

Mobile Communications Company Invests to Expand Network Ahead of Cup

Mobile communications operator MTN has claimed network and infrastructure improvements totaling 7.1 billion Rand ($959 million USD) in the lead-up to the World Cup.

The company said that as part of the work it had completed network coverage upgrades at all stadiums being used in the tournament.

MTN spends R7bn on WC upgrades
Fin 24
March 23, 2010